South Africa Loans 101: What Should You Do When You Can’t Repay Your Payday Loan on Time?June 27, 2019
Once you take out a loan, it becomes your responsibility to make sure that you will always have sufficient funds to repay it on the agreed schedule. However, unexpected things often happen. Particularly when you’re working on a strict budget and just one source of income, you might find yourself in a tight financial situation and by the looks of it, you won’t be able to pay your upcoming loan dues.
Payday loans usually need to be paid back in a lump sum until the due date. When you’re unable to pay the loan on time, you’ll be faced with overwhelming bank fees and penalties and not to mention, bombarded with calls from collection agencies. A representative from the collection agency might even visit you. When this keeps on happening, you’ll also have to deal with a negative credit history, and it may even go as far as going to court.
No matter how big or small your unpaid loan amount is, it is an obligation that you should not ignore. So, what should you do when your current budget doesn’t seem to be able to make room for your upcoming loan repayment due?
Talk to your lender.
If the due date is approaching and you realize that you don’t have enough money left to pay for it, don’t hesitate to talk to your lender. Tell them about your current situation and ask for a new payment agreement. If there’s one thing your lender wants from you, it is your payment. Like you, they don’t take joy in working with a collections agency. After all, it means an additional cost for them. So, if you talk to them and express your intent to pay back your loan and that you need to request for a due date adjustment, they’ll most likely oblige.
Know your rights.
Many borrowers tend to feel scared about not being able to repay their loans on time because they don’t know their rights. Remember that payday lenders have no right to threaten you, much less bully you. They can’t even have you arrested because failure to pay back a payday loan is not a criminal offence. However, the lender can take their claim to court, and if ever you’re summoned, make sure that you appear.
As a borrower and consumer, you have the right to request a settlement agreement. If you tell the lender that you’re considering bankruptcy, they will eventually soften and offer ways for you to repay your loan most conveniently and realistically possible.
Deal with the collectors.
If you were unable to pay your loan and failed to talk to your lender, the next step they will take is to endorse your account to a collection agency. They will call you, send you a letter, and even visit you. You can tell the collection agency about your willingness to make a payment arrangement, and they will most likely help you with your request or offer an equally convenient payment alternative.
If you’re looking for a payday loan in South Africa, get in touch with us today! We’re happy to help you with your situation.